Vista Bank is suing FirstCapital Bank, its CEO and its chairman claiming more than $6 million in damages because Reagor-Dykes owner Rick Dykes provided information that allowed it to act ahead of Reagor-Dykes companies' filing for bankruptcy protection. Vista claims a check kiting scheme was carried out at its expense.

The suit states Dykes served as a member of FirstCapital's board of advisors until a few days ago, and previously held a seat on its board of directors. The filing claims FirstCapital "transitioned Dykes from a Director to its Board of Advisors to avoid banking regulatory scrutiny and potentially to increase the amount FirstCapital could lend Reagor-Dykes. Further, Dykes is a large FirstCapital shareholder, holding more than 350,000 of FirstCapital shares." Vista claims FirstCapital now hides its history with Dykes by removing any mention of him from its website.

Vista's filing claims a scheme of "deposits and fraudulent float credit survived only as long as Reagor-Dykes maintained the volume and speed of its deposit cycle to keep ahead of the check clearing and cash letter process; however, a disruption such as Reagor-Dykes filing bankruptcy would cut the cycle, reveal the fraud, and lead Vista to immediately freeze its Reagor-Dykes accounts.

"Vista would return the items Reagor-Dykes wrote on its Vista accounts and initiate returns on the FirstCapital checks Reagor-Dykes deposited to prevent unauthorized credit advances. And that's exactly what happened -- except that FirstCapital found a way to use its insider access to Dykes to channel over $6,000,000 in losses and damages to Vista, allowing FirstCapital to knowingly profit from the scheme."

"Lacking FirstCapital's insider access, Vista learned of the Reagor-Dykes bankruptcy through local Lubbock news reports and word of mouth," Vista's filing states. The document continues, "Acting on the damning inside information FirstCapital received from Dykes on July 31st, FirstCapital blew up the standard process and "worked all night" in a greedy attempt to return items onto Vista". The court document claims Dykes admitted to Vista counsel that FirstCapital's team did, in fact, work late July 31 and early Aug. 1 to accelerate the process.

Vista alleges that "of all of Reagor-Dykes banking institutions, including at least FirstCapital, IBC Bank of Oklahoma, AIM Bank and Vista, (i) only FirstCapital submitted an ongoing return cash letter on August 1st, the date Reagor-Dykes filed bankruptcy; and (ii) only FirstCapital attempted to charge back July 27, 2018 Reagor-Dyke items."

Vista is claiming gross negligence because it acted "with knowledge and a conscious indifference to the extreme degree of risk of harm that Vista would inevitably incur. Accordingly, Vista asserts a claim for gross negligence and punitive damages."